Following 2008, stunned comfort-seekers wanted their 401k balances restored as quickly as possible and therefore turned a blind eye to Wall Street's corruption. Unfortunately, for the New Gomorrah, the cumulative cost of bailing out Wall Street after 2008 is far more than they can afford, and then some. So the society that never learns is going All In for a third and last bludgeoning in the exact same casino that took their money the last two times...
Bitcoin the Tulip Bubble of our time
Now once again, outside of the Bollinger Band on a 3,500% one year gain
Notice the lack of volume compared to last spring (Data from: bitcoincharts.com)
Voxeljet went public on October 18th at $13/share and tripled on the first day.
No froth here...
It only took five years to get investors fully onboard...
Just this week we learned that Wall Street is still writing its own regulations and submitting them to the game show hosts in Congress to rubber stamp. The Idiocracy at large didn't bat an eye. We also learned this week that the Mayor of Toronto likes crack cocaine, which apparently is not grounds for dismissal. All of this massive corruption that is merely considered "business as usual" will be the ultimate undoing for this decadent society.
The "Recovery" is The Biggest Lie Ever Sold
The Fed pumps $85 billion of newly printed money into the economy on a monthly basis merely to keep it from collapsing. The chart below clearly indicates that every time the Fed takes its foot off the gas, interest rates (and the stock market) fall because the economy begins to deflate again. Every Fed monetization program has led to a sell-off in Treasury bonds (rise in interest rates) as inflation expectations rise.
The real question is, why the hell are interest rates still so low - lower than they were in 2011, despite a trillion dollars of monetary expansion in the past year alone?
The best rally $3 trillion can buy:
Fed balance sheet (red line) with the Almighty Dow (black).
A market that has been manipulated higher over a five year period of time by a combination of HFT Bots trading on millisecond boundaries, $3 trillion of printed Fed money, $7 trillion in new Government debt, and small investor money finally pouring in after four years of being on the sidelines, offers no way out. Sentiment towards this fake market is massively complacent from both hedge funds and small investors. When it collapses, there will be nothing to stop its fall. There will be no one on the other side of the trade. Correlation across all sectors is now at 100% so the only place left to go is out of stocks into "cash":
Nowhere to Hide: Correlation is Annihilation
(Sectors: Transports, Semiconductors, Healthcare, Consumer Staples)
How Long Can This Continue?
You tell me how many fools are left to throw their life savings into this contrivance and I will tell you when it will end. Clearly I underestimated this society's ability to be duped over and over again. The power of wishful thinking can't be underestimated. The Baby Boomers have one goal in mind which is to retire with full benefits, regardless of the past choices they have made - endorsing military blunders, tax cuts for RomneyBots etc. So, now nothing is allowed to change that could affect that program. The 2008 wake up call was totally ignored and history's dumbest generation went All In yet again, buying into an all new debt conflated mirage even more lethal than the housing bubble. History's most decadent society this side of Gomorrah was bound to sell its soul to keep the party going for a few years longer. How much will they lose this time?